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This is a huge pet peeve of mine. It sounds weird to write it where people are reading it on the Internet, but please stop reading the Internet.

Look, I love the Internet. It is great for a lot of things. I can get a recipe. I can follow my favorite sports team. I can check the weather for weird cities I will never go visit. I can even post pictures of my family.

But, when it comes to personal injury claims, car accidents, and insurance, the Internet is a bad, bad thing. There is a lot of garbage out there. How about the guy who wants to sell you his secret formula on how much your case is worth? The only secret formula should be at KFC and should have nothing to do with insurance. Or maybe you are reading about the insurance company and how fair they are. Sure, they are all fair - when it comes to saving their money.

The Internet is full of garbage. You should keep reading this blog (and my other blogs), but stay away from 95% of the stuff on the Internet about car accident cases!

This may be the shortest post I will write on this blog, but here goes.

The insurance adjuster is not your friend. However, the adjuster is a person and you should treat him or her that way. Even when I completely disagree with an adjuster, I don’t treat them poorly or yell at them. Being pleasant can make a world of difference. Besides, isn't the world a better place when we are all nice to each other?

This week, the
California legislature passed two bills to set up a health-insurance
marketplace. This move comes after the health care reform bill, which was
passed in March, directed states to set up their own health care exchanges, or
else their residents will receive access to a federal exchange. Governor
Schwarzenegger is expected to sign the bills.

California
is the first state to begin implementation of a health-care exchange. Massachusetts and Utah
already had exchanges in place when the bill was passed. California’s exchange will most likely be
the largest one established by one state. As many as 8.3 million individuals
may be eligible to purchase insurance plans through the exchange. Under federal
law, businesses with up to 100 employees can buy coverage through the exchange.
The limit may be raised by states in 2017.

The exchange will most likely offer insurance through a
website that will provide detailed information about plans. The plans will be
standardized. Live helpers will be available to explain the plans to consumers.
The plans aren’t required to be operating until January 2014. Under the plan, California will sell
insurance in five categories, which will vary widely in coverage and price.

This legislation comes on the heels of an announcement by
California’s Department of Insurance that it will allow premium increases by
Anthem Blue Cross (14% increase) and Blue Shield of California (9% increase).

On August 18, new regulations go into effect in California that are
aimed at preventing illegal cancellations of health insurance policies.

Rescission, which is the practice of cancelling health
insurance policies for mistakes on the health insurance applications, even
minor mistakes, is targeted in the new regulations. According to the
government, rescission is estimated to add $300 million in profits to the
health insurance industry.

The new regulations require questions on a health insurance
application to be clear, specific and understandable. The applications are not
allowed to use double-negatives or some types of compound questions. Insurance
companies will be required to take into account the level of knowledge an
average individual with no medical training may have when formulating the
questionnaires. Questions on the application must be relevant to the
underwriting process. In addition, applicants must be allowed to check that
they are unsure or cannot remember to questions on the application. Consumers
must also have the right to respond during rescission investigations.

The California Department of Insurance is going to publish a
new approved questionnaire for insurance companies to use in obtaining
applicants’ medical history. Insurance companies that decide not to use the
pre-approved questionnaire cannot use unapproved questionnaires as the basis of
a rescission later.

You can read in more detail about the new regulations here
and here.The new regulations are here.

These are the tentative rulings for law and motion matters set for
Tuesday, July 7, 2009, at 8:30 am in Dept

Although virtually all business owners are aware of the
recently-enacted health care reform law, many do not know that tax credits for
small businesses that provide health insurance to their workers take
effect this year. In California
alone, over 400,000 small businesses could qualify for the credit.

Under the law, companies with no more than 25 workers, and
whose average salaries are less than $50,000, are eligible for a tax credit of
up to 35 percent of the employer’s contribution for health insurance premiums. The
maximum credit for non-profit small businesses is 25 percent. Companies must
pay 50 percent of its employees’ health care premiums to qualify for the
credit. Almost 80 percent of small businesses are expected to qualify for the
credit. There are approximately 4 million small businesses nationwide.

The credit was designed as an incentive for more companies
to offer health benefits to their employees. Small companies typically pay 18
percent more for insurance than large companies. The credits will last until
2014, when health insurance exchanges will be available to help small
businesses provide health insurance to employees.

Under the new law, companies with at least 50 employees will
have to pay penalties if they do not offer health insurance to workers.

At the end of June, Govhigh-risk individualsernor Schwarzenegger signed two bills
that create insurance pools for who have been denied
insurance due to pre-existing conditions. The program is restricted to
individuals who have been without health insurance for at least six months.

The program will receive about $761 million in federal
funding but will be run by the state. It is expected to provide approximately
25,000 to 30,000 Californians obtain health insurance. Currently, about 250,000
Californians have been denied insurance coverage because of pre-existing health
care problems.

The high-risk is designed to provide health insurance for
high-risk individuals until 2014, when insurers will be prevented from denying
health insurance to adults with pre-existing conditions. Beginning in
September, insurers will no longer be able to deny health insurance coverage to
children with pre-existing conditions.

The new insurance pool will be operated by California’s Managed Risk Medical Insurance
Board. The Board has begun taking names of individuals interested in the
program, although it hasn’t yet designed the insurance applications or the
policies. The applications are expected to be available within a month.To learn more about the insurance pools or to
request an application, visit http://www.mrmib.ca.gov/.

The California Department of Insurance announced that it
will be reviewing plans for rate increases for individual health insurance
policies for its four largest individual policy providers: Anthem Blue Cross, Aetna, Health Net, and Blue Shield of California. The
review will only occur for policies that are purchased by individuals, not by
employers or Medicare.

Currently, California
law requires 70 percent of all health insurance premiums paid to be spent on
medical benefits. Anthem announced plans in February to raise rates on its
individual policy holders by up to 39 percent.

However, an analysis found errors in Anthem’s proposal which
meant that after the raise in premiums, Anthem would be spending less than 70
percent of premiums on benefits. Anthem withdrew the proposal and will resubmit
its rate hikes. Blue Shield wants rate hikes of 18 percent, and Aetna wants a 19 percent raise in rates.

The Department of Insurance appointed an independent actuary
to review the companies to make sure they are following state insurance laws
when raising rates. Aetna and Blue Shield are
being reviewed now. Anthem Blue Cross and Health Net will face reviews in the
future.

When evaluating their life insurance, many couples assume
they only need life insurance for an employed spouse. After all, stay at home
parents, caregivers for elderly parents and other non-employed spouses
typically don’t contribute financially to the household. In addition, many U.S. companies
offer life insurance benefits to their employees, which typically aren’t
available to a non-employed spouse.

However, often the contributions a non-working spouse makes
to the family can be tremendous, and those contributions should be valued. In
fact, a recent survey from Salary.com determined that a stay at home mom’s
salary, if she got paid for the 10 most common tasks she performs, would be
just over $117,000 per year. Because there is not an income to be replaced, many
factors must be taken into account to determine the amount of life insurance
needed, instead of simply calculating annual salary and multiplying it by a
factor determined by the insured.

Some factors to consider when deciding how much life
insurance to purchase for a non-employed spouse are:

How
much would it take to hire extra support people, such as housekeeping help
and childcare providers?

Will
the surviving spouse have extra expenses to cover associated with his or
her spouse’s death?

Will
the surviving spouse have to cut back on hours at work in order to assume
duties formerly provided by the non-employed spouse?

I strongly encourage my clients, when shopping for life
insurance, to consider not only replacing the employed spouse’s income, but
also to get an amount to replace the non-employed spouse’s family
contributions.

The Washington Post is reporting that health insurers are now mining data from a variety of databases when you apply for insurance. From the story by Ellen Nakashima:

"Health and life insurance companies have access to a powerful new tool for evaluating whether to cover individual consumers: a health "credit report" drawn from databases containing prescription drug records on more than 200 million Americans."

This shouldn't really surprise anyone. Insurance companies make decisions based on information. The more information they have, the more accurately they can underwrite. When they underwrite people accurately, the premiums charged.

Consumer groups, myself included, get upset when insurance companies conduct "post claims underwriting." Post claims underwriting is when an insurance company looks at records after a claim is filed and then decides if it should cancel the policy. Post claims underwriting is, quite simply, wrong.

So, the solution? Let the insurance companies do the underwriting at the claims stage. Insurance companies get medical records now and do this. This process just allows them to do it faster and cheaper. I just don't see the problem.

The California Department of Managed Health Care did a good thing. It brokered a deal with Health Net and Kaiser to reinstate health insurance policies to 1,200 people whose policies were rescinded by the insurance companies. The State is trying to reach a similar deal with PacifiCare, Blue Shield, and my favorite, Anthem Blue Cross. (By the way, adding Anthem to their name does not change the humor to the YouTube video.)

In a nutshell, these people had policies cancelled when they started to run up large medical bills. The insurance companies would dig through to find some technicality to use to cancel coverage. The DMHC determined this was not proper underwriting. Health Net, in fact, agreed to a fine, but admitted no wrongdoing. (For once, wouldn't it be nice for someone to actually admit wrong doing a la Charles Barkley.)

DISCLAIMER

Notice

This blog is made available by the lawyer publisher for educational purposes only as well as to give information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand that there is no attorney client relationship between you and the Blog publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney in your state. Jonathan G. Stein, is licensed to practice law in the state of California only.
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